Chinese construction equipment manufacturer Zoomlion has signed a deal to set up a joint venture plant in India with ElectroMech, India’s largest industrial crane manufacturer, according to Beijing’s Economic Times. The vice president of Changsha Zoomlion Heavy Industry Science and Technology Development Co., He Wenjin, said the joint venture will be Zomlion’s first directly invested overseas plant, with Zoomlion holding a 70-perecnt stake and ElectroMech owning the rest.
He, after signing the agreement with ElectroMech in Changsha, said Zoomlion has a long-term strategy in the Indian market and plans to invest U.S. $100 million to develop business in India during the next few years. The new plant, which will focus on tower crane production, will reach U.S. $50 million in annual sales within five years, He said.
ElectroMech managing director Tushar Mehendale said it is a good time for Chinese construction manufacturers to invest in India because the country plans to invest U.S. 1 trillion on infrastructure construction during the next five years. Another Chinese construction equipment maker Sany Heavy Industry Co. started a factory in India in 2009.
As of 2011, the Indian market for tower crane sales was about $93 million, but analysts expect the sector to grow by more than 20 percent annually during the next decade.